How I Built This: Tempur-Pedic: Bobby Trussell

  • Before discovering memory foam on a trip to Sweden he was making a living in horse racing and breeding: He was desperate for a new gig and he gambled everything to launch it. (2:47) 

  • All horses, all the time: He majored in finance but would by sitting in a lecture reading about horse racing. (4:51) 

  • How he broke into the horse race industry: He wrote letters to the top 10 horse trainers in the country. 9 didn’t answer. 1 of them offered me two jobs. (5:32) 

  • He started a horse lending startup? We started Stallion Management Services. That was a very good idea but very bad timing. The horse industry went into recession. I went broke. So did everyone else. I felt like the brokest man in America. I had two kids. Two mortgages. And no job. (10:36) 

  • How he got involved with mattresses: A Swedish horse chiropractor called me and said you have to come to Sweden to see this mattress company. I was in yes mode [desperate to find an opportunity] so I went and met a guy named Michael Magnusson and that changed my life. (16:27) 

  • The next day: I slept on the memory foam mattress and I woke up and said this is the most amazing product I’ve ever encountered. I’m in the mattress business. (19:33) 

  • The worst marketing plan ever: We will sell this at truck stops! (21:07)

  • Why would this Swedish mattress entrepreneur give you, a horse trainer, exclusive US distribution rights? He was in the horse business in Sweden. He was like my Swedish alter ego. We hit it off over the horses. He got comfortable with me. (22:23) 

  • One of the hardest things he had to do: To convince my previous investors that even though we lost money in something I knew a lot about that we were going to make money in something I knew nothing about. (24:19) 

  • [To keep distribution rights] We were supposed to sell 10,000 mattresses the first year: We sold 70. (28:07) 

  • Bobby’s first major breakthrough: The chiropractors [that couldn’t sell the mattresses] kept saying you should make a pillow out of this stuff. I asked them how they would sell the pillow if they were me? They said you need to get it in people’s hands. I thought: What if I just mailed them one? So we mailed 500 pillows to 500 unsuspecting chiropractors. It came with a letter that said the pillows is yours to keep if you order 4. 125 of them bought 4 pillows. [@$49 each]. (32:29) 

  • How Bobby got his pillow into Brookstone: I would call the head of the purchasing department every day for weeks and weeks and weeks. He finally called me back to tell me to stop calling him back. We hung up. He then took the pillow out of the box and called me back and said: We will buy 500 pillows. (35:52) 

  • Higher prices can lead to more sales: We have something no one else has. So why would you discount it? (38:58) 

  • Revenue by year: $300,000, $2.6 million, $6.5 million, $13 million, $28 million, $45 million… (41:10) 

  • The main marketing message for his mattresses: If you have back pain you need this mattress. Similar to Volvo: If your number one concern is safety then you need this car. (42:30) 

  • How Bobby convinced Brookstone to sell the mattress: The CEO of Brookstone wouldn’t sell the mattress so I sold the mattress to Sharper Image [their biggest competitor]. I told Brookstone I’d stop selling to Sharper Image if Brookstone would put the mattress in their stores. They said ok. (43:08) 

  • Another huge breakthrough: Figuring out how to sell directly to consumers. I advertised in the New Yorker. The New Yorker gave discounts to direct response advertisers. The price went from 25k per ad down to 6k per ad. This advertising also increased mattress sales in-store. (44:35) 

  • Most entrepreneurs don’t want to sell a controlling interest. My philosophy is the opposite: I’d rather have 5% of something big than 51% of something small. (48:38)